Alibaba handles more transactions than Amazon and eBay combined. What does Alibaba do, and why has it chosen to list its shares in New York rather than Hong Kong?

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The Chinese tech company Alibaba let's you buy and sell online - think Amazon or eBay. Now the Internet commerce giant will have something else in common with those U.S. companies. Alibaba plans to go public in New York later this year.

And as NPR's Steve Henn reports, this could be the biggest initial public offering ever.

STEVE HENN, BYLINE: Just how big is Alibaba? It's huge.

KATHLEEN SMITH: It could be one of the top 20 most valuable companies that are trading in U.S. markets.

ANANT SUNDARAM: It is supremely profitable.

COLIN GILLIS: If you want to get a sense of perspective, they handle more transactions than Amazon and eBay combined.

HENN: That's Kathleen Smith from Renaissance Capital, Anant Sundarem from Dartmouth's' Tuck School of Business and Colin Gillis at BGC Financial.

GILLIS: It is going to be one of the largest IPOs ever.

HENN: Gillis says Wall Street Investment banks are salivating at the size this deal. Alibaba is likely to sell between $15 and $20 billion in shares of its stock and the deal could generate more than a billion dollars in fees for Wall Street bankers.

GILLIS: That is what the excitement is being driven by. Alibaba is the largest e-commerce company in China.

HENN: Actually, it's the largest e-commerce company in the world. It was founded in 1999 as a business to business website and since then it's grown and expanded and diversified.

JACK MA: Alibaba is the infrastructure of Chinese e-commerce.

HENN: That is Jack Ma, Alibaba's founder, speaking with tech journalist Kara Swisher at conference a few years ago.

Today Alibaba's business includes that original business to business website, as well as, Taobao.com, a site where small and medium size Chinese businesses can sell directly to customers. There's a consumer to consumer site. It also runs a logistic company, a Web hosting and data processing firm, and Alipay - a payment processor that allows Chinese consumers to shop online.

MA: People say Alipay is like PayPal. No, it's different. PayPal is based on credit cards and things. We are like escrow services and it's a new innovation in China.

HENN: Customers who didn't have credit cards or banking accounts could go to the local post office and deposit cash into their account with Alipay. Then when they were shopping online, they could use those accounts to fund their purchases.

MA: Jack Ma says in the U.S., commerce already works pretty well, so e-Commerce is kind of like the desert, an after thought for businesses.

But in China because everything is so bad, so we are lucky become the main course.

HENN: Credit, delivery, shipping - the very basics of business are being built online in China.

And because of that, Collin Gillis at BGC Financial believes Alibaba handles hundreds of billions in transactions each year. He thinks it earned close to $3 billion in profits last year alone. That's more profit than Amazon has earned in its entire history. But...

GILLIS: The important thing to remember here, right, Alibaba is a privately held company. You still have very limited financial data because they're prospectus is not out yet.

HENN: And Anant Sundaram at Dartmouth's Tuck of Business isn't convinced buying Alibaba stock would be a wise move for investors. The SEC recently cracked down on public company accounting in China and Sundaram points out that China's domestic economy is slowing. He says if Alibaba's many websites are going to continue to grow they'll have compete in the West.

SUNDARAM: They're all operating in a protected turf. It's a protected home market with no foreign competition.

HENN: That said, Sundaram says if he were an executive at eBay or Amazon, the thought of Jack Ma and Alibaba suddenly flush with cash and moving aggressively into U.S. markets would strike fear into his heart.

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